Benefits Contract Providing a Bundle of Benefits

ABSTRACT

According to one embodiment of the invention, a benefits contract includes an agreement to provide a plurality of benefits for at least one person. The agreement provides for an account including a plurality of units. Each unit is associated with multiple benefits. For example each unit may be associated with multiple benefits such as life insurance, health insurance, supplemental health insurance, long-term care insurance, short-term disability insurance, long-term disability insurance, prescription drug insurance, a plurality of income payments, a withdrawal benefit, an annuity, a property and casualty benefit, or other similar benefits. The agreement is such that a person associated with the benefits contract may choose to exercise a particular unit, or fraction thereof, to receive only one of the three or more benefits; and such that the benefits account (or plurality of units) may be purchased tax-free using funds from a tax-deferred retirement account.

RELATED APPLICATIONS

This application claims the benefit under 35 U.S.C §119(e) of U.S.Provisional Application Ser. No. 60/701,096 filed Jul. 19, 2005.

TECHNICAL FIELD OF THE INVENTION

This invention relates generally to benefits contracts and moreparticularly to a benefits contract providing a bundle of benefits.

BACKGROUND OF THE INVENTION

There are a variety of benefits contracts available on the market andthese benefits contracts are typically purchased to provide some levelof security against one or more potential risks. A benefits contract mayalso have an investment function, such as, for example, in the case ofan annuity. For example, life insurance contracts typically providefinancial security for family members in the event of a person's death.Similarly, health insurance typically provides security against thepotentially high costs of an illness or injury. Long-term care benefitstypically provide security against the potentially high cost of suchcare. These and other benefits contracts serve to pass the risk of anunknown event from one party to another, typically in exchange for afee.

Although there are many different types of benefits contracts available,customers must select the appropriate contract or combination ofcontracts to provide the most utility with limited resources. Often, itmay not be possible to purchase all of the benefits contracts that aconsumer may desire, due to limited financial resources. In addition,some consumers are reluctant to purchase certain types of benefitscontracts out of fear that they will make payments for a contract forwhich they will never receive any return. For example, a consumer maypurchase a long-term care benefit for a considerable amount of money anddie without ever having a need for long-term care.

SUMMARY OF THE INVENTION

According to one embodiment of the invention, a benefits contractincludes an agreement to provide a plurality of benefits for at leastone person. The agreement provides for an account including a pluralityof units. Each unit is associated with multiple benefits. For exampleeach unit may be associated with multiple benefits such as lifeinsurance, health insurance, supplemental health insurance, long-termcare insurance, short-term disability insurance, long-term disabilityinsurance, prescription drug insurance, a plurality of income payments,a withdrawal benefit, an annuity, a property and casualty benefit, orother similar benefits. The agreement is such that a person associatedwith the benefits contract may choose to exercise a particular unit, orfraction thereof, to receive only one of the three or more benefits; andsuch that the benefits account (or plurality of units) may be purchasedtax-free using funds from a tax-deferred retirement account.

According to another embodiment of the invention, a benefits contractincludes an agreement to provide a plurality of benefits that may beelected. The plurality of benefits includes different types of benefits,and at least some of the plurality of benefits include an electionperiod including a start date. There may be a delay between the electionperiod start date for at least one of the plurality of benefits and theelection period start date for a second one of the plurality ofbenefits. The election period may denote a time period during which itis permissible to elect a benefit.

Certain embodiments of the present invention may provide varioustechnical advantages. For example, certain embodiments may allow acustomer to purchase contracts with units that may be selectively usedin the future to elect multiple benefits. In some embodiments, theseunits may be purchased at multiple points in time. Certain embodimentsmay provide flexibility by allowing a customer to choose when topurchase benefit units, how much to purchase, when to exercise thebenefits, and which benefits to exercise. Certain embodiments maysimplify the decision making process related to purchasing multiplebenefits by allowing the customer to purchase units that can be used toelect multiple benefits and then wait to determine which benefits toelect until a later time, such as when a need for the benefit arises oris anticipated. Certain embodiments may also reduce costs associatedwith providing a bundle of benefits by limiting the time in which one ormore benefits may be exercised.

Other technical advantages of the present invention will be readilyapparent to one skilled in the art from the following figures,descriptions, and claims. Moreover, while specific advantages have beenenumerated above, various embodiments may include all, some, or none ofthe enumerated advantages.

BRIEF DESCRIPTION OF THE DRAWINGS

For a more complete understanding of the present invention and itsadvantages, reference is now made to the following description, taken inconjunction with the accompanying drawings, in which:

FIG. 1 illustrates a system for providing a benefits contract accordingto a particular embodiment of the present invention;

FIG. 2 illustrates example benefits according to a particular embodimentof the present invention;

FIG. 3 illustrates an example timeline showing coverage times fordifferent benefits according to a particular embodiment;

FIG. 4 illustrates an example timeline showing the purchase and exerciseof units according to a particular embodiment;

FIGS. 5A and 5B illustrate an example data processing system forproviding a benefits contract according to a particular embodiment; and

FIG. 6 illustrates an embodiment of a general purpose computer.

DETAILED DESCRIPTION OF THE EXAMPLE EMBODIMENTS

It should be understood at the outset that although exampleimplementations of embodiments of the invention are illustrated below,the present invention may be implemented using any number of techniques,whether currently known or not. The present invention should in no waybe limited to the example implementations, drawings, and techniquesillustrated below.

FIG. 1 illustrates a system 10 for providing benefits contract 100according to a particular embodiment of the present invention. System 10may interact with customer 110 and issuer 120; and system 10 may utilizeone or more units 130. Each unit 130 may represent an amount of each ofa plurality of benefits 200. Benefits contract 100 may represent acontract between customer 110 and issuer 120. According to certainembodiments, system 10 may be utilized to provide benefits contract 100to customer 110, through the use of multiple units 130, eachrepresenting an amount of each of a plurality of benefits 200. Each unit130 may be exercised to elect a particular one of the plurality ofbenefits 200 in the amount specified.

Benefits contract 100 may represent an agreement or a group ofagreements between one or more customers 110 and one or more issuers120, for the one or more issuers 120 to provide multiple benefits 200 tothe one or more customers 110. For example, in certain embodiments,benefits contract 100 may represent an agreement between customer 110and issuer 120 to provide one of three electable benefits 200 forcustomer 110.

In certain embodiments, for example but not by way of limitation,customer 110 may purchase ten units in year one. Each of the units 130may represent, for example, five benefits 200. In year ten, an electionmay be made to utilize two units 130 for the first benefit 200. Thiswould leave eight units 130 which could be exercised at a later date. Inyear fourteen, an election may be made to exercise six units 130 for thesecond benefit 200. This would leave two units 130 which could beexercised at a later date. In year twenty, three additional units 130may be purchased, for a total of five units which can be exercised. Inyear thirty, an election may be made to exercise four units for thesecond benefit 200 and one unit for the fifth benefit 200. At thispoint, all of the units would be exhausted and benefits contract 100 mayterminate. This example is just one possible scenario for a particularembodiment of the present invention and is not intended as a limitation.

Customer 110 may broadly refer to one or more of a funding party 112, anaccount holder 114, a beneficiary 116, and/or an agent or other thirdparty acting on behalf of one of these. Funding party 112 may broadlyrepresent an entity or group of entities providing funds to purchase orfund benefits contract 100. Account holder 114 may broadly represent anentity or group of entities whose risk is mitigated by benefits contract100. Beneficiary 116 may broadly refer to an entity or group of entitieswho receive one or more financial transfers (or other transfers ofconsideration) pursuant to provisions of benefits contract 100. Forexample, in certain embodiments, beneficiary 116 may be an entity thataccount holder 114 identifies as an intended recipient of proceeds uponthe death of account holder 114. As another example, in certainembodiments, beneficiary 116 may be a health care provider who may bereimbursed for providing health care to account holder 114. In certainembodiments, one or more of funding party 112, account holder 114, andbeneficiary 116 may be the same entity or group of entities. Forexample, funding party 112 and account holder 114 may be the same. Asanother example, account holder 114 and beneficiary 116 may be the same.In certain embodiments, funding party 112 may be an individual, abusiness entity, or a government entity. For example, funding party 112may be an employer of an account holder 114. In certain embodiments,account holder 114 and beneficiary 116 may be related. For example,account holder 114 and beneficiary 116 may be related as husband andwife. In certain embodiments, two individuals, such as a married couple,may both be account holders 114. In certain embodiments, beneficiary 116may be different for different benefits 200. For example, for onebenefit 200 account holder 114 may also be beneficiary 116 and foranother benefit 200 the spouse of account holder 114 may be beneficiary116.

While this patent describes various actions, benefits, steps, etc. inrelation to a customer 110, funding party 112, account holder 114,and/or beneficiary 116, those descriptions should not be construed aslimiting because benefits contract 100 (or controlling laws orregulations) might provide for various persons to exercise control, takevarious actions, receive certain benefits, and/or affect certainfeatures with regard to benefits contract 100.

Issuer 120 may represent an entity that provides and/or sells benefitscontract 100 to customer 110. In certain embodiments, issuer 120 mayrepresent a government entity or a business entity, such as a bank or aninsurance company. Issuer 120 may also represent multiple entities thatoperate together to provide or sell benefits contract 100.

Unit 130 may broadly refer to an accounting unit used to track thecoverage for account holder 114, according to the provisions of benefitscontract 100. In certain embodiments, each unit 130 may representexercisable benefits coverage provided for account holder 114. Forexample, (but not by way of limitation) funding party 112 may purchase,and issuer 120 may allocate, one-hundred units 130 to account holder114. In certain embodiments, the one-hundred units 130 may provide acertain electable level of coverage for account holder 114 for each of aplurality of benefits 200. Each unit 130 may be associated with multiplebenefits 200. In certain embodiments, each unit 130 provides customer110 with the right and/or option to exercise the unit 130 and therebyutilize one of the benefits 200 associated with that unit 130 inaccordance with the terms of benefits contract 100.

In certain embodiments, benefits contract 100 may provide for multipleclasses of units 130. For example, different classes of units 130 may beassociated with different groups or combinations of benefits 200. Asanother example, different classes of units 130 may represent differenttax treatments for the units 130. As yet another example, differentclasses of units 130 may represent different payment structures for theunits 130, such as lump sum, periodic payment, etc. In certainembodiments, different classes of units 130 may be associated with theage of account holder 114 at the time that units 130 are purchased. Incertain embodiments, different classes of units 130 may representcertain characteristics of one or more account holders 114, such asgender, underwriting class, health, medical history, family history,and/or participation in one or more activities (e.g., smoking, high riskactivities, etc.). For example, in a particular embodiment, benefitscontract 100 may include two account holders 114 and different classesof units 130 may be purchased for each account holder 114.

In certain embodiments, units 130 may represent (or be proportional to)either a purchase dollar value and/or a proceed dollar value for one ormore benefits 200. For example, one unit 130 may represent a one dollarincremental investment associated with benefits contract 100. Although,units 130 have been described as representing dollar values, in otherembodiments, units 130 may represent one or more values in anyincremental currency. In certain embodiments, units 130 may represent(or be proportional to) a fractional currency value and/or the valuerepresented by unit 130 may change over time.

In certain embodiments, benefits contract 100 may provide that accountholder 114 must exercise at least one complete unit 130 at a time.Alternatively, in certain embodiments, account holder may exercise afraction of a unit 130 and/or exercise multiple units 130 together witha fraction of a unit 130. For example, (but not by way of limitation) incertain embodiments, account holder 114 may exercise 20.25 units at onetime.

Benefit 200 may broadly refer to an instrument or agreement to transferrisk from one entity to another, including investment vehicles such asannuities. According to certain embodiments of the present invention,benefits contract 100 may be associated with multiple types orcategories of benefits 200. In certain embodiments, each type orcategory of benefit 200 may serve to transfer a different type orcategory of risk.

FIG. 2 illustrates example benefits 200 that may be associated with aunit 130 according to a particular embodiment of the present invention.As shown, benefits 200 may include: life income benefit 202 (which couldbe an annuity), withdrawal benefit 204, short-term disability benefit206, long-term disability benefit 208, long-term care benefit 210,prescription coverage benefit 212, Medicare supplement benefit 214,health insurance 216, life insurance 218, and/or property and casualtybenefit 220. The example benefits 200 illustrated in FIG. 2 are intendedto indicate generally an example of the types and categories of benefits200 that may be covered by benefits contract 100. The example benefits200 illustrated in FIG. 2 are not intended to be an exclusive list. Thepresent invention contemplates other benefits 200 beyond those includedwithin FIG. 2. For example, benefits 200 may also include an incomebenefit for a term of years. As another example, in certain embodiments,benefits 200 may include (and/or benefits contract 100 may be associatedwith another agreement that includes) property and casualty coverage.(For example, in a particular embodiment, benefits contract 100 may beassociated with an umbrella liability agreement which includes propertyand casualty coverage.) As yet another example, in certain embodiments,benefits 200 may include an accumulation benefit guaranteeing, forexample, that an asset or account will have at least certain non-zerovalue at a future point in time. (For example, in a particularembodiment, an accumulation benefit may guarantee a future value for anaccount with at least a portion of the account assets invested in one ormore equities.) Although a variety of example benefits are describedherein, the present invention contemplates other appropriate benefitsbeing associated with one or more units 130 and/or benefits contract100.

Lifetime income benefit 202 may broadly represent a plurality of incomepayments that may be transferred to beneficiary 116 (or multiplebeneficiaries 116) on a periodic basis during the lifetime of one ormore designated lives. In certain embodiments, a designated life may bethe life of account holder 114 or the life of beneficiary 116. Incertain embodiments, lifetime income benefit 202 may be tied to and/orbehave similar to a fixed or variable annuity. For example, upon anelection to exercise one or more units 130 to utilize as lifetime incomebenefit 202, issuer 120 may transfer a certain amount of funds to animmediate annuity (or simply make payments according to an annuity)which will then be annuitized to provide a plurality of income payments.In some embodiments, a deferred annuity could be elected with one ormore units 130.

Withdrawal benefit 204 may broadly represent an income source that maybe discretionarily withdrawn by beneficiary 116. In certain embodiments,these discretionary withdrawals may be limited to a specified amountand/or to a specified period of time. For example, in certainembodiments, the specified period of time may be related to the life ofaccount holder 114. In certain embodiments, withdrawal benefit 204 maybe tied to and/or behave similar to a deferred annuity.

Short-term disability benefit 206 may broadly represent incomeprotection against a disability, the term of which may be relativelylimited in duration. In certain embodiments, the disability may be dueto an accident, sickness, etc. In certain embodiments, payments madepursuant to short-term disability benefit 206 may be contingent uponaccount holder 114 being admitted under the care of a medical careprovider. In certain embodiments, the maximum period of the coverage,the initial date of eligibility, and the payment amount may varydepending on the number of units 130 elected, the age of account holder114, and/or the previous income of account holder 114. The inventionthus may allow the exercise of certain units 130 (or fractions thereof)by account holder 114 when he becomes disabled to elect short-termdisability benefit 200. If the account holder never becomes disabled,then account holder 114 may use his units for other benefits 200.

Long-term disability benefit 208 may broadly represent income protectionagainst an extended period of disability. In certain embodiments, thedisability may be due to an accident or sickness. In certainembodiments, payments made pursuant to long-term disability benefit 208may be contingent upon account holder 114 being admitted under the careof a medical care provider. In certain embodiments, the maximum periodof the coverage, the initial date of eligibility, and/or the paymentamount may vary depending on the number of units 130 elected, the age ofaccount holder 114, and/or the previous income of account holder 114. Incertain embodiments, election of this benefit 200 may be made whenneeded in some embodiments similar to the election discussed above forshort-term disability benefit 206.

Long-term care benefit 210 may broadly represent protection againstexpenses associated with care provided for an extended duration (or mayrepresent the provision of such long-term care). For example, long-termcare benefit 210 may provide financial assistance (or in-kindassistance) to at least partially offset the costs associated withmedical or support services. In certain embodiments, the need for suchcare may be due to disability or age. For example, account holder 114may require care as a result of a loss of some or all capacity tofunction. In certain embodiments, payments made to pursuant to long-termcare benefit 210 may cover the costs of assisted living arrangements,home health care, nursing home care, and/or psychiatricinstitutionalization. For example, long-term care benefit 210 may coverthe costs of providing help with everyday activities such as eating,bathing, and/or dressing. In certain embodiments, election of thisbenefit 200 may be made when needed in some embodiments similar to theelection discussed above for short-term disability benefit 206.

Prescription coverage benefit 212 may broadly represent protectionagainst expenses associated with the costs of medically prescribed drugsor devices. In certain embodiments, prescription coverage benefit 212may be limited to expenses associated with certain categories ofprescribed drugs or devices. In some embodiments, the benefit mayprovide drugs or devices to beneficiary 116, rather than reimbursementor payment for the same.

Medicare supplement benefit 214 may broadly represent protection againsthealthcare expenses not covered by Medicare or another governmentsubsidized healthcare coverage. For example, Medicare supplement benefit214 may cover the costs associated with Medicare co-payments and/orco-insurance, the costs arising after Medicare coverage is exhausted,the costs associated with recovery from an illness, injury, or surgery,and/or the costs associated with healthcare expenses in a foreigncountry. In certain embodiments, the scope, value, and duration ofMedicare supplement benefit 214 may vary.

Health insurance 216 may broadly represent protection against a widevariety of health care costs. For example, in certain embodiments,health insurance 216 may cover costs associated with expenses resultingfrom injury or illness. In certain embodiments, health insurance 216 maycover a wide variety expenses associated with illness and injury,including but not limited to hospitalization, surgery, physician's fees,medicines, testing, imaging, radiation therapy, maternity and nursingcare, eyeglasses and/or contact lenses, crutches, and/or prosthesis. Insome embodiments, such benefits might be provided in-kind.

Life insurance 218 may broadly represent an agreement to make afinancial distribution to beneficiary 116 upon the death of accountholder 114. In certain embodiments, the financial distribution may be inthe form of one or more securities. In certain embodiments, upon thedeath of account holder 114 financial distributions pursuant to lifeinsurance 218 may be a lump sum payment or a periodic income stream. Incertain embodiments, multiple beneficiaries 116 may receive financialdistributions following the death of an individual account holder 114.In certain embodiments, life insurance 218 may include a second to dieprovision.

Property and casualty benefit 220 may broadly represent protectionagainst expenses associated with personal property loss (or damage)and/or personal liability. For example, in certain embodiments, propertyand casualty benefit 220 may represent protection against expensesarising from damage to a home or automobile.

In certain embodiments, each unit 130 includes a combination of multiplebenefits 200. For example, each unit 130 may allow for account holder114 to exercise units 130 and thereby utilize one or more of themultiple benefits 200.

In certain embodiments, but not by way of limitation, benefits contract100 may provide that multiple benefits 200 are associated with each unit130, but that the number and combination of benefits 200 associated witheach unit 130 may change over time. For example, in certain embodiments,a single unit 130 may be associated with short-term disability benefit206, prescription coverage benefit 212, and life insurance 218 for thefirst interval after the single unit 130 is purchased. Then, accordingto this example, for the second interval the single unit 130 may beassociated with short-term disability benefit 206, long-term disabilitybenefit 208, prescription coverage benefit 212, and life insurance 218.And then, according to this example, for the third interval, the singleunit 130 may be associated with lifetime income benefit 202 andlong-term care benefit 210. In certain embodiments, the benefits 200associated with certain units 130 may differ from benefits 200associated with other units 130. For example, the differences may betied to the purchase date (or the age of account holder 114 at the timeof purchase) for the units 130 and/or a class in which the units 130 areincluded.

In operation, benefits contract 100 may provide for customer 110 topurchase units 130, each associated with multiple benefits 200. Benefitscontract may further provide that customer 110 may later exercise one ormore of the purchased units 130 and, in exercising the one or morepurchased units 130, may receive one of the benefits 200 associated witheach unit 130. In certain embodiments, customer 110 may wait until theneed arises (or is anticipated) which necessitates the utilization ofone or more benefits 200 before exercising units 130 to utilize thosebenefits 200. For example, customer 110 may purchase one-hundred units130 in year one and then, upon sustaining a disabling injury in yearten, may exercise fifty units 130 to utilize those units as long-termdisability benefit 206. The remaining units of customer 110 may be savedto exercise in the future. In certain embodiments, the exercise of oneor more units 130 (and/or the utilization of one or more benefits 200)by customer 110 may be subject to one or more eligibility requirements.

In certain embodiments, if one or more purchased units 130 have not beenexercised upon the death of account holder 114, the unexercised unitsmay be automatically exercised to utilize a default benefit 200, theunexercised units may be transferred to another account holder 114, theunexercised units 130 may lapse, the unexercised units may betransferred to a charitable institution, and/or some combination ofthese. For example, if account holder 114 purchases one-hundred units inyear one and then account holder 114 dies in year twenty withoutexercising fifty units 130, the remaining units 130 may be exercised toutilize those units 130 as life insurance 218 by default.

In certain embodiments, benefits contract 100 may provide that, for oneor more benefits 200 associated with a unit 130, there is a delaybetween the date that the unit 130 is exercised and the date that theelected benefit 200 may be utilized. For example, (but not by way oflimitation) in certain embodiments, if a unit 130 is exercised toutilize lifetime income benefit 202 on Jan. 1, 2005, the income paymentsprovided for under the provisions of lifetime income benefit 202 may notbegin until Jan. 1, 2007. Such time delays after exercise may apply toother types of benefits as well. The time delays may be different (orzero) for different benefits.

In certain embodiments, customer 110 may purchase units 130 usingpre-tax funds subject to applicable law. For example, customer 110 maypurchase units 130 (and/or benefits contract 100) tax-free usingproceeds from a retirement account, depending upon applicable law. Asanother example, an employer may purchase units 130 for an employee suchthat the units are not considered a taxable benefit depending uponapplicable law. Alternatively, units 130 may be purchased using funds,all or a portion of which are taxable or after tax. For example, acertain amount of units 130 may be purchased using pre-tax funds and theremaining units 130 may be purchased using after-tax funds. In certainembodiments, units 130 purchased pursuant to benefits contract 100 maybe considered a tax deferred investment.

In certain embodiments, units 130 may be purchased up front, in multipleinstallments, on a continuing periodic basis, at random times, or anycombination thereof. For example, (but not by way of limitation)customer 110 may purchase one-hundred units 130 in year one forone-hundred dollars, with additional one-hundred dollar payments beingrequired every year for ten years to maintain the units 130. In certainembodiments, the cost associated with units 130 may vary over time. Forexample, the cost for one-hundred units 130 may increase or decreaseover time based upon the age of account holder 114, a change in one ormore risk factors for account holder 114 (such as health status), thelength of time since other units were purchased, and/or the performanceof an external index. In certain embodiments, benefits contract 100 mayprovide that the way in which units 130 are funded may be converted atthe election of account holder 114 or upon the happening of an event.For example, a variable periodic payment for units 130 may be convertedat the election of account holder 114 to a fixed periodic payment or toa lump sum payment. In some embodiments, various numbers of units 130may be purchased with lump sums at various points in time.

In certain embodiments, issuer 120 and/or benefits contract 100 mayallow for a benefit 200, that is not included within benefits contract100, to be converted to a benefit 200 within benefits contract 100. Forexample, issuer 120 may offer both benefits contract 100, includinglong-term care benefit 210, and may also offer a separate long-term carebenefit. In this example, issuer 120 may allow a customer 110 who haspurchased the separate long-term care benefit to convert the separatelong-term care benefit to a specified number of units 130 under benefitscontract 100. Conversely, in certain embodiments, issuer 120 and/orbenefits contract 100 may allow for a benefit 200 that is includedwithin benefits contract 100 to be converted to a benefit 200 that isnot included within benefits contract 100 (or for units 130 to be soconverted). In some embodiments, some or all types of conversions may beprohibited, either by contract or by law or regulation.

In certain embodiments, issuer 120 and/or benefits contract 100 mayallow for one or more units 130 (or a value based on units 130) to betransferred from one benefits contract 100 to another benefits contract100 and/or another type of benefits agreement. For example, if accountholder 114 is an employee and funding party 112 is an employer, ifaccount holder 114 changes jobs, units 130 may be transferred or “rolledover” to another benefits contract 100 associated with the new employerof account holder 114 (or with the account holder 114 himself). Asanother example, in certain embodiments, account holder 114 may transferall or a portion of units 130 (or a value based on units 130) to abenefits contract 100 associated with another issuer 120, or to anotherbenefits agreement entirely. In all cases, the ability to transfer maybe restricted by contract, law or regulation.

In certain embodiments, benefits contract 100 may allow for one or moreof certain benefits 200 to be added to or subtracted from coverage underone or more units 130. For example, in certain embodiments, customer 110may choose (and/or purchase) additional benefits 200 to be associatedwith all or a portion of purchased units 130. As another example, incertain embodiments, customer 110 may choose to remove one or morebenefits 200 from association with those units 130. In theseembodiments, choices to add or subtract one or more of certain benefits200 from coverage may or may not correspond to a change in the price ofunits 130 and/or benefits contract 100. Similarly, in these embodiments,choices to add or subtract one or more of certain benefits 200 fromcoverage may or may not correspond to a change in the utilizable valueof one or more benefits 200. In certain embodiments, choices to add orsubtract one or more of certain benefits 200 may be made at thediscretion of issuer 120.

In certain embodiments, the utilizable value of one or more benefits 200associated with a unit 130 may be fixed at the time that the unit 130 ispurchased. For example, in a particular embodiment, customer 110 maypurchase fifty units 130, each associated with three benefits 200. Inthis particular embodiment, for example, the benefits 200 includelifetime income benefit 202, long-term care benefit 210, and lifeinsurance 218. Upon the purchase of units 130, the utilizable value ofeach benefit 200 associated with each unit 130 is fixed. Each unit 130exercised as lifetime income benefit 202 may provide, for example,financial distributions of $100 per month until death. Each unit 130exercised as long-term care benefit 210 may provide, for example,long-term care reimbursements of up to $500 per month for a specifiedperiod of months. Each unit 130 exercised as life insurance 218 may, forexample, distribute $1,000 in proceeds to beneficiary 116 according tothe terms of life insurance 218.

In certain embodiments, the utilizable value of one or more benefitsassociated with a unit 130 may vary based upon a schedule fixed at thetime that the unit 130 is purchased. For example, the utilizable valueof a benefit 200 may vary based on the length of time since theassociated unit 130 was purchased. As another example, the utilizablevalue of a benefit 200 may vary based upon the age of account holder114. As yet another example, the utilizable value of a benefit 200 mayvary based upon the number of units 130 purchased or upon the number ofunits 130 exercised.

In certain embodiments, the utilizable value of one or more benefits 200associated with a unit 130 may vary over time based upon an externalindex (or inflation) and/or upon the value of an underlying asset. Forexample, the utilizable value of a benefit 200 may vary based upon theConsumer Price Index and/or upon a health cost index. As anotherexample, the utilizable value of a benefit 200 may vary based upon themarket performance, or market value, of an underlying security or asset.

Thus, in certain embodiments, the ratios of utilizable value between thebenefits 200 associated with a unit 130 may remain the same throughoutthe duration of benefits contract 100. Alternatively, in certainembodiments, the ratios of utilizable value between two or more benefits200 associated with a unit 130 may change over time based on one or moreof a plurality of factors, such as the age of the account holder, changein an index, and/or the time since the unit 130 was purchased. In someembodiments, the utilizable value may change for some benefits and befixed for others.

In certain embodiments, the utilizable value of one or more benefits 200may be based upon a lump sum value, a periodic payment over a fixedperiod of time, all or a portion of a certain category of expenses overa fixed period of time, all or a portion of a certain category ofexpenses over an indefinite period of time, and/or any combination ofthese. In certain embodiments, the utilizable value of one or morebenefits 200 may be capped at a maximum total payout, at a maximumperiodic payout, or a combination of these. In certain embodiments, theutilizable value of one or more benefits 200 may be based upon the value(or change in value) of one or more assets.

According to certain embodiments, benefits contract 100 (or applicablelaws or regulations) may allow customer 110 to purchase units atdifferent times and at different intervals. For example benefitscontract 100 (or applicable laws or regulations) may allow customer 110to purchase multiple units 130 simultaneously and/or to purchase units130 a certain number at a time over an extended period of time. Certainembodiments of benefits contract 100 (or applicable laws or regulations)may also provide flexibility by allowing customer 110 to choose when topurchase units 130, how many units 130 to purchase, when to exerciseunits 130, and which benefits 200 associated with units 130 to elect.Certain embodiments of benefits contract 100 (or applicable laws orregulations) may simplify the decision making process for customer 110in relation to purchasing multiple benefits 200 by allowing the customerto purchase units 130 representing multiple benefits 200. Certainembodiments of benefits contract 100 (or applicable laws or regulations)may also allow customer 110 to purchase units 130 and then wait todetermine which benefits 200 associated with the purchased units 130 toutilize until a later time, such as when a need for a particular benefit200 arises or is anticipated. Certain embodiments may also reduce thecosts that issuer 120 may incur in providing multiple benefits 200 bylimiting the time in which one or more of multiple benefits 200 may beutilized.

In certain embodiments, benefits contract 100 may provide that for oneor more benefits 200 there may be an imposed delay between the date thatthe associated units 130 are purchased and the first date in which aparticular benefit 200 may be elected. For example, in certainembodiments, a unit 130 may be purchased when account holder 114 isthirty years old and the unit 130 may be associated with three benefits200 including lifetime income benefit 202, long-term disability benefit208, and long-term care benefit 210. In this particular example, and notby way of limitation, the long-term disability benefit 208 and thelong-term care benefit 210 may be elected immediately, but the lifetimeincome benefit 202 may not be elected until account holder 114 reaches acertain age, such as age sixty-five. Such delay before a benefit 200 maybe executed may be the same for all, some, or none of the benefits 200associated with a particular unit 130.

Similarly, in certain embodiments, benefits contract 100 may providethat for one or more benefits 200 there may be an imposed time limitafter which date the one or more benefits 200 may not be elected. Forexample, in certain embodiments, a unit 130 may be purchased whenaccount holder 114 is thirty years old and the unit may be associatedwith multiple benefits including at least long-term disability benefit208 and long-term care benefit 210. In this particular example, and notby way of limitation, the long-term disability benefit 208 may beelected at any time beginning on the date of purchase and ending on thedate that account holder 114 turns fifty-five years old. Such an imposedtime limit in which a benefit may be elected may be the same for all,some, or none of the benefits 200 associated with a particular unit 130.

Issuer 120 may price benefits contract 100 and/or units 130 according totechniques the same as or similar to any of numerous well known pricingtechniques. As an example, issuer 120 may offer benefits contract 100 ata price based upon the age and/or gender of account holder 114, one ormore health variables for account holder 114, the number and type ofbenefits 200 covered by benefits contract 100, the number of units 130ordered, and/or any other appropriate criteria. As another example,issuer 120 may price benefits contract 100 and/or units 130 at twice themarket price for the most expensive of the benefits 200 covered. As yetanother example, issuer 120 may price benefits contract 100 and/or units130 at a price equal to the sum of the market prices for each of thebenefits 200 covered. Any appropriate type of pricing could be usedsubject to applicable law or regulation.

In certain embodiments, benefits contract 100 (and/or units 130) may betied to (and/or associated with) one or more assets. In theseembodiments, the availability, cost, and/or value of benefits contract100 (and/or units 130) may be related to the size and/or value of (orchanges to the size and/or value of) the one or more assets. In certainembodiments, changes to the size and/or value of the one or more assetsmay be due to market changes for, distributions from, and/orcontributions to the one or more assets.

FIG. 3 illustrates an example timeline 300 showing coverage times fordifferent benefits 200 according to a particular embodiment. In certainembodiments, benefits 200 associated with a unit 130 may have differentcoverage periods. For example, the coverage periods for differentbenefits 200 may have different start dates, different durations, and/ordifferent end dates. In certain embodiments, start dates, end dates,and/or durations may be based upon the age of the account holder and/orthe date that the units 130 were purchased.

In the example embodiment shown in FIG. 3, unit 130 is purchased whenaccount holder 114 is thirty years old. Benefit 200 a has a potentialcoverage period that begins on the purchase date for unit 130 and endsupon the death of account holder 114. Benefit 200 b has a potentialcoverage period that begins five years after the purchase date for unit130 and ends upon the death of account holder 114. Benefit 200 c has apotential coverage period that begins on the purchase date for unit 130and ends thirty-five years later when account holder is sixty-five yearsold. (In certain embodiments, the start date and/or the end date of oneor more benefits 200 may be tied to the birthday of an account holder114 or an anniversary of the purchase date of unit 130.) Benefit 200 dhas a potential coverage period that begins thirty-five years after unit130 is purchased, when account holder 114 is sixty-five years old, andends upon the death of account holder 114.

As an example, in certain embodiments, short-term disability benefit206, long-term disability benefit 208, and life insurance 218 may belimited to election prior to a retirement age for account holder 114. Asanother example, in certain embodiments, lifetime income benefit 202 andwithdrawal benefit 204 may be limited to election after a retirement agefor account holder 114.

FIG. 4 illustrates an example timeline showing the purchase and exerciseof units 130 according to a particular embodiment. According to certainembodiments, units 130 may be purchased at different times and may beexercised at different times to utilize different benefits 200.According to certain embodiments, upon the death of account holder 114purchased and unexercised units 130 may be exercised and utilized as adefault benefit, such as life insurance benefit 218.

In the example embodiment shown in FIG. 4, ten units 130 are purchasedwhen account holder 114 is thirty years old. An additional twenty units130 are purchased when account holder 114 is forty years old. Whenaccount holder 114 is sixty years old, fifteen units 130 are exercisedto utilize benefit 200 e. When account holder 114 is seventy years old,five units 130 are exercised to utilize benefit 200 f. Account holder114 dies at the age of eighty. Upon the death of account holder 114, theremaining ten units 130 are exercised to utilize default benefit 200 g.

FIGS. 5A and 5B illustrate an example data processing system foradministering and providing one or more benefits contracts 100 accordingto a particular embodiment. While in certain embodiments benefitscontract 100 is entered into without using a computer, other embodimentsmay have a computerized option for entering into an agreement. Dataprocessing system 500 represents hardware and controlling logic foradministering and/or providing benefits contract 100. In the embodimentshown, data processing system 500 may include processing module 502,memory 504, and interface 506. As shown, data processing system 500 maybe included as a system controlled by administrator 550. Although dataprocessing system 500 is shown as a single system, data processingsystem 500 may be distributed across multiple platforms and housed inmultiple locations, some or all of which may or may not be controlled byadministrator 550.

Processing module 502 may control the operation and administration ofelements within data processing system 500 by processing informationreceived from interface 506 and memory 504. Processing module 502 mayinclude any hardware and/or controlling logic elements operable tocontrol and process information. For example, processing module 502 maybe a computer, a programmable logic device, a microcontroller, and/orany other suitable device or group of devices.

Memory 504 may store, either permanently or temporarily, data and otherinformation for processing by processing module 502 and communicationusing interface 506. Memory 504 may include any one or a combination ofvolatile or nonvolatile local or remote devices suitable for storinginformation. For example, memory 504 may include random access memory(RAM), read only memory (ROM), magnetic storage devices, optical storagedevices, or any other suitable information storage device or combinationof these devices. Memory 504 may store, among other things, order data520, transaction data 522, and account data 530.

Interface 506 communicates information to and receives information fromdevices or systems coupled to data processing system 500. For example,interface 506 may communicate with other elements controlled byadministrator 550, network 540, and/or elements coupled to network 540.Thus interface 506 may include any hardware and/or controlling logicused to communicate information to and from elements coupled to dataprocessing system 500.

Network 540 represents communication equipment, including hardware andany appropriate controlling logic, for interconnecting elements coupledto network 540. Thus network 540 may represent a local area network(LAN), a metropolitan area network (MAN), a wide area network (WAN),and/or any other appropriate form of network. Furthermore, elementswithin network 540 may utilize circuit-switched, packet-basedcommunication protocols and/or other communication protocols to providefor network communications. The elements within network 340 may beconnected together via a plurality of fiber-optic cables, coaxialcables, twisted-pair lines, and/or other physical media for transferringcommunications signals. The elements within network 340 may also beconnected together through wireless transmissions, including infraredtransmissions, 802.11 protocol transmissions, laser line-of-sighttransmissions, or any other appropriate wireless transmission method.

Administrator 550 represents an entity or group of entities thatcoordinate the administration of benefits contract 100. For example,administrator 550 may be issuer 120, an agent for issuer 120, or anotherthird-party entity that operates as an outsourcing entity for theadministration of benefits contract 100.

In operation, order data 520 and/or transaction data 522 may betransmitted from purchaser 510 to data processing system 500 throughnetwork 540. Data processing system 500 may process order data 520and/or transaction data 522, generate account data 530, and transmitaccount data 530 to purchaser 510 through network 540. Purchaser 510 mayrepresent one or more customers 110 or purchaser 510 may represent oneor more agents or intermediaries acting on behalf of one or morecustomers 110.

Order data 520 may include the name and age of account holder 114, oneor more tax identifiers, the resident state of account holder 114, and adesignation of beneficiary 116. In certain embodiments, order data mayalso include a number of units 130 requested to be purchased, healthhistory information, personal financial information, and gender.Transaction data 522 may include a number of units 130 to be exercisedand the benefits 200 elected to be utilized. Account data 330 mayinclude an account number and a document, or reference to a document,containing the provisions of benefits contract 100. In certainembodiments, account data 530 may also include status information forbenefits contract 100. For example, account data 530 may include thenumber of purchased units 130, the coverage periods for each benefit200, and/or the potential coverage value for each benefit 200 based onthe number of purchased units 130.

According to an example embodiment, upon receipt of order data 520, dataprocessing system 500 may calculate any applicable fees associated withthe provisions of benefits contract 100 and/or units 130. Dataprocessing system may also determine an identifier, such as an accountnumber associated with benefits contract 100, and identify benefits 200associated with units 130. Data processing system 500 may generateaccount data 530 and transmit account data 530 to purchaser 510 throughthe use of network 540. According to an example embodiment, upon receiptof transaction data 522, data processing system 500 may update accountdata 530. For example, data processing system 500 may update statusinformation associated with benefits contract 100, such as the number ofunexercised units 130, and/or the potential coverage value for eachbenefit 200 based on the number of unexercised units 130.

In certain embodiments, purchaser 510 may initiate the transmission oforder data 520 and/or transaction data 522 through the use of aweb-based application. For example, purchaser 510 may access one or morewebsites and may submit certain portions of order data using thosewebsites. Similarly, purchaser 510 may utilize one or more electronicfund transfer (EFT) technologies to purchase benefits contract 100. Theuse of Internet technologies to purchase benefits contract 100 mayinvolve the use of one or more security provisions such as digitalsignatures, digital certificates, passwords, and encryptions. In certainembodiments, the collection of order data 520 and/or transaction data522 may occur through the use of an interactive process. For example, aweb-based application may present a series of questions to purchaser510, which purchaser 510 may respond to and, in responding, submit thecontents of order data 520.

FIG. 6 is an embodiment of a general purpose computer 600 that may beused in connection with one or more pieces of software used to implementthe invention. General purpose computer 600 may generally be adapted toexecute any of the well-known OS2, UNIX, Mac-OS, Linux, and WindowsOperating Systems or other operating systems. The general purposecomputer 600 in this embodiment comprises a processor 602, a randomaccess memory (RAM) 604, a read only memory (ROM) 606, a mouse 608, akeyboard 610 and input/output devices such as a printer 614, disk drives612, a display 616 and a communications link 618. In other embodiments,the general purpose computer 600 may include more, less, or othercomponent parts. Embodiments of the present invention may includeprograms that may be stored in the RAM 604, the ROM 606 or the diskdrives 612 and may be executed by the processor 602. The communicationslink 618 may be connected to a computer network or a variety of othercommunicative platforms including, but not limited to, a public orprivate data network; a local area network (LAN); a metropolitan areanetwork (MAN); a wide area network (WAN); a wireline or wirelessnetwork; a local, regional, or global communication network; an opticalnetwork; a satellite network; an enterprise intranet; other suitablecommunication links; or any combination of the preceding. Disk drives612 may include a variety of types of storage media such as, forexample, floppy disk drives, hard disk drives, CD ROM drives, DVD ROMdrives, magnetic tape drives or other suitable storage media.

Although FIG. 6 provides one embodiment of a computer that may be usedwith the invention, the invention may additionally utilize computersother than general purpose computers as well as general purposecomputers without conventional operating systems. Additionally,embodiments of the invention may also employ multiple general purposecomputers 600 or other computers networked together in a computernetwork. Most commonly, multiple general purpose computers 600 or othercomputers may be networked through the Internet and/or in a clientserver network. Embodiments of the invention may also be used with acombination of separate computer networks each linked together by aprivate or a public network.

Several embodiments of the invention may include logic contained withina medium. In the embodiment of FIG. 6, the logic comprises computersoftware executable on the general purpose computer 600. The medium mayinclude the RAM 604, the ROM 606 or the disk drives 612. In otherembodiments, the logic may be contained within hardware configurationsor a combination of software and hardware configurations. The logic mayalso be embedded within any other suitable medium without departing fromthe scope of the invention.

Although the present invention has been described in severalembodiments, a plenitude of changes and modifications may be suggestedto one skilled in the art, and it is intended that the present inventionencompass such changes and modifications as fall within the presentappended claims.

To aid the Patent Office, and any readers of any patent issued on thisapplication in interpreting the claims appended hereto, applicants wishto note that they do not intend any of the appended claims to invoke ¶6of 35 U.S.C. §112 as this paragraph and section exists on the date offiling hereof unless “means for” or “step for” are used in theparticular claim.

1-22. (canceled)
 23. A data processing system configured to manage abenefits account, the data processing system comprising: one or morememory devices; one or more processing modules; and software embodied inthe one or more memory devices and configured, when executed by the oneor more processing modules, to: store, in the one or more memorydevices, account data representing a number of benefits units associatedwith a plurality of benefits according to provisions of a benefitscontract, wherein each benefits unit is discretionarily exercisabletowards at least one of the plurality of benefits, and wherein theplurality of benefits comprises: one or more from the first groupconsisting of: a plurality of income payments; and a withdrawal benefit;and one or more from the second group consisting of: a disabilityinsurance; a long-term care insurance; a prescription drug coverage; ahealth care coverage; and a supplemental health care coverage; receivetransaction data representing a request to exercise a specified numberof benefits units towards a specified one of the plurality of benefits;generate status information identifying a coverage period provided atleast in part by exercise of the specified number of benefits towardsthe specified one of the plurality of benefits; transmit the statusinformation through a network; determine a default benefit to betransferred to a beneficiary designated by an account holder, whereinthe default benefit is based at least in part on the account datarepresenting the number of benefits units that are discretionarilyexercisable, and wherein the default benefit comprises a life insurancebenefit; and in response to a triggering event, transfer the lifeinsurance benefit to the beneficiary designated by the account holder,the triggering event being the death of the account holder.
 24. The dataprocessing system of claim 23, wherein: the specified one of theplurality of benefits is the plurality of income payments; theidentified coverage period is a lifetime of a designated life; and thesoftware is further configured, when executed by the one or moreprocessing modules, to transfer on a periodic basis the plurality ofincome payments during the lifetime of the designated life, theplurality of income payments being transferred in response to exerciseof the specified number of benefits towards the plurality of incomepayments.
 25. The data processing system of claim 23, wherein: thespecified one of the plurality of benefits is the supplemental healthcare coverage; and the identified coverage period comprises: a startdate when the supplemental health care coverage begins; and a stop datewhen the supplemental health care coverage terminates.
 26. The dataprocessing system of claim 23, wherein the software is furtherconfigured, when executed by the one or more processing modules, toupdate the account data representing the number of benefits units thatare discretionarily exercisable, the update based on the receivedtransaction data.
 27. The data processing system of claim 23, whereinthe software is further configured, when executed by the one or moreprocessing modules, to: receive order data comprising a number ofbenefits units requested to be purchased; and in response to thereceived order data, calculate a sum of the number of benefits unitsstored in the one or more memory devices and the number of benefitsunits requested to be purchased.
 28. The data processing system of claim23, wherein the generated status information further identifies amaximum coverage value for the specified one of the plurality ofbenefits.
 29. A method for managing a benefits account, the methodcomprising: storing, in one or more memory devices, account datarepresenting a number of benefits units associated with a plurality ofbenefits according to provisions of a benefits contract, wherein eachbenefits unit is discretionarily exercisable towards at least one of theplurality of benefits, and wherein the plurality of benefits comprises:one or more from the first group consisting of: a plurality of incomepayments; and a withdrawal benefit; and one or more from the secondgroup consisting of: a disability insurance; a long-term care insurance;a prescription drug coverage; a health care coverage; and a supplementalhealth care coverage; receiving, at a data processing system,transaction data representing a request to exercise a specified numberof benefits units towards a specified one of the plurality of benefits;using the data processing system, generating status informationidentifying a coverage period provided at least in part by exercise ofthe specified number of benefits towards the specified one of theplurality of benefits; using the data processing system, transmittingthe status information through a network; using the data processingsystem, determining a default benefit to be transferred to a beneficiarydesignated by an account holder, wherein the default benefit is based atleast in part on the account data representing the number of benefitsunits that are discretionarily exercisable, and wherein the defaultbenefit comprises a life insurance benefit; and using the dataprocessing system and in response to a triggering event, transferringthe life insurance benefit to the beneficiary designated by the accountholder, the triggering event being the death of the account holder. 30.The method of claim 29, wherein: the specified one of the plurality ofbenefits is the plurality of income payments; and the identifiedcoverage period is a lifetime of a designated life.
 31. The method ofclaim 30, further comprising, transferring on a periodic basis theplurality of income payments during the lifetime of the designated life,the plurality of income payments being transferred using the dataprocessing system and in response to exercise of the specified number ofbenefits towards the plurality of income payments.
 32. The method ofclaim 29, wherein: the specified one of the plurality of benefits is thesupplemental health care coverage; and the identified coverage periodcomprises: a start date when the supplemental health care coveragebegins; and a stop date when the supplemental health care coverageterminates.
 33. The method of claim 29, further comprising, using thedata process system and in response to the received transaction data,updating the account data representing the number of benefits units thatare discretionarily exercisable.
 34. The method of claim 29, furthercomprising receiving, at the data processing system, order datacomprising a number of benefits units requested to be purchased; andusing the data processing system and in response to the received orderdata, calculating a sum of the number of benefits units stored in theone or more memory devices and the number of benefits units requested tobe purchased.
 35. The method of claim 29, wherein the generated statusinformation further identifies a maximum coverage value for thespecified one of the plurality of benefits.
 36. Software embodied in atangible computer-readable medium and configured, when executed by oneor more processing modules, to: store, in one or more memory devices,account data representing a number of benefits units associated with aplurality of benefits according to provisions of a benefits contract,wherein each benefits unit is discretionarily exercisable towards atleast one of the plurality of benefits, and wherein the plurality ofbenefits comprises: one or more from the first group consisting of: aplurality of income payments; and a withdrawal benefit; and one or morefrom the second group consisting of: a disability insurance; a long-termcare insurance; a prescription drug coverage; a health care coverage;and a supplemental health care coverage; receive transaction datarepresenting a request to exercise a specified number of benefits unitstowards a specified one of the plurality of benefits; generate statusinformation identifying a coverage period provided at least in part byexercise of the specified number of benefits towards the specified oneof the plurality of benefits; transmit the status information through anetwork; determine a default benefit to be transferred to a beneficiarydesignated by an account holder, wherein the default benefit is based atleast in part on the account data representing the number of benefitsunits that are discretionarily exercisable, and wherein the defaultbenefit comprises a life insurance benefit; and in response to atriggering event, transfer the life insurance benefit to the beneficiarydesignated by the account holder, the triggering event being the deathof the account holder.
 37. The software of claim 36, wherein: thespecified one of the plurality of benefits is the plurality of incomepayments; the identified coverage period is a lifetime of a designatedlife; and the software is further configured, when executed by the oneor more processing modules, to transfer on a periodic basis theplurality of income payments during the lifetime of the designated life,the plurality of income payments being transferred in response toexercise of the specified number of benefits towards the plurality ofincome payments.
 38. The software of claim 36, wherein: the specifiedone of the plurality of benefits is the supplemental health carecoverage; and the identified coverage period comprises: a start datewhen the supplemental health care coverage begins; and a stop date whenthe supplemental health care coverage terminates.
 39. The software ofclaim 36, further configured, when executed by the one or moreprocessing modules, to update the account data representing the numberof benefits units that are discretionarily exercisable, the update basedon the received transaction data.
 40. The software of claim 36, furtherconfigured, when executed by the one or more processing modules, to:receive order data comprising a number of benefits units requested to bepurchased; and in response to the received order data, calculate a sumof the number of benefits units stored in the one or more memory devicesand the number of benefits units requested to be purchased.
 41. Thesoftware of claim 36, wherein the generated status information furtheridentifies a maximum coverage value for the specified one of theplurality of benefits.